The Major Investment Study split the project into three phases, the first of which (enhanced bus service) was partially implemented. As of January 2010[update], the planning of Phase 2 has been suspended because MBTA and the Commonwealth of Massachusetts have insufficient funding to build a substantial portion of that phase (projected to cost $2.4 billion).[2] Some interim bus service improvements are under way in the absence of major funding.

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Transportation advocates in Boston have complained that rail transit riders cannot travel from one outlying area to another without first traveling to the downtown hub stations, changing lines, and traveling outbound again. Some of the radial transit lines, notably the Green Line, are so overcrowded that service is very slow and limited in capacity because of rush-hour "crush loads". There are several crosstown bus lines, such as the #1, #66, CT1, CT2, and CT3 routes, but they are slow, unreliable, and subject to bus bunching because they must operate in mixed street traffic.

A circumferential rapid transit line was proposed by the City of Boston as early as 1923, and circumferential transit has been studied as early as 1972, in the Boston Transportation Planning Review.[3] Detailed proposals were not studied until the late 1990s.[4]

The proposed project has three phases. The first phase has been partially implemented. Phase 1, as it is commonly called, involves expanding "crosstown" bus lines serving the entire corridor and "express commuter" lines connecting to suburban locations. Phase 2 will create six overlapping Bus Rapid Transit lines forming a complete ring around downtown Boston. Phase 3 includes the implementation of rail service on the most heavily traveled portion of the ring, from Assembly Square in south-eastern Somerville to Dudley Square in the Roxbury neighborhood of Boston, via East Cambridge.

Phase 1[5] as recommended in the Major Investment Study, would expand the "crosstown" (CT) bus system by extending and increasing frequency on the three existing lines, and by adding eight new lines. It also adds "express commuter" (EC) lines for connections to locations outside the corridor. Estimated ridership according to the Phase 2 DEIR would have been 40,000 for 2003, at a capital cost of $100 million, for low-floor, low-emissions buses.

The MBTA determined that Phase 1 of the Urban Ring project did not meet the threshold requirements for an extensive environmental review, and so can be implemented as a part of its normal service planning process. However, of the eleven CT routes and three EC routes proposed, only CT1, CT2, and CT3 are currently running as of 2014[update].[6]

The MBTA filed the Draft Environmental Impact Report (DEIR) for Phase 2 with the Massachusetts Environmental Policy Act (MEPA) Office on November 30, 2004.[7] In its FY2005-10 and draft FY2006-11 Capital Improvement Plans, the MBTA has not budgeted any money for the Urban Ring project, beyond supporting the EIR process.[8]

Phase 2[9] would convert and expand five of the "crosstown" lines (CT2, CT3, CT4, CT5, and CT8) into bus rapid transit lines that overlap and form a complete ring around the urban core.

This routing skips Gilman and Union Squares in Somerville, but these locations would be connected to the new Lechmere Station via the Green Line Extension Project, originally expected to be operational by the end of 2014, but initiated as of 2014[update]. The Grand Junction Railroad crossing of the Charles River would be widened to include bus lanes and a multi-use path.

There would be two major spurs. Three different routings are being considered for the first spur, which leaves from Commonwealth Avenue and goes to:

An interim surface routing is proposed, with multiple stops in the Longwood Medical Area, while the tunnel is under construction.

The capital cost for this version of the plan is estimated at $2.2 billion, with a projected daily ridership of 170,000. 53% of the route is either in a bus-only lane, dedicated busway, or tunnel.[10] This was increased from the previous plan for Phase 2, to improve travel times. As a result of the implementation of Phase 2, ridership growth on the Red, Orange, Blue, and Green lines would be slowed, but Commuter Rail ridership boosted. The Urban Ring would have a higher collective ridership than the Orange Line, Blue Line, or the entire Commuter Rail system.[10]

Phase 3[11] would add a rail line on the most heavily traveled portion of the corridor, from Assembly Square in Somerville to Lechmere, Kendall Station, crossing Massachusetts Avenue near MIT, and connecting at Longwood Medical Area, Ruggles, and Dudley Square. The exact alignment will be determined through further environmental review, and includes possible stops in Union Square Somerville, Cambridgeport and/or Kenmore Square, and a possible new tunnel under the Charles River.

There are now three alternatives being considered for Phase 3, which differ from the alternatives described in the Major Investment Study (MIS) and Draft Environmental Impact Review (DEIR). Employment growth projections have also changed since those documents were written. The three proposed options for what type of rail service to build are:

Estimated ridership is 282,000-293,000 passengers per day in 2025; about 47,000 would be diverted from cars, and most of the rest would be diverted from trips on congested radial lines, reducing the need to travel through downtown Boston.